Finding Delhi Transport Infrastructure Development Corporation’s (DTIDC) contradictory stands on GeM portal and QCBS methodology render cancellation arbitrary, the Delhi High Court has directed interim award to Bluespring at its quoted monthly price while new GeM tender proceeds. The Court clarified that while a procuring entity has the right to cancel a tender, such cancellation must be supported by cogent reasons and must fall within the circumstances set out in paragraph 7.4.11(1) of the Manual for Procurement of Non-Consultancy Services, 2025.
Where responsive bids are available, the aim should be to finalise the tender by taking mitigating measures rather than cancelling it. A State entity cannot take inconsistent and contradictory stands; flip-flopping on reasons for cancellation is impermissible and renders the cancellation arbitrary. Further, continuing an incumbent contractor at a price higher than the L1 bidder’s quoted price, when the L1 bidder is willing to provide services at the quoted price, causes loss to the public exchequer and is wholly inexplicable, added the Court.
The Division Bench comprising Justice V. Kameswar Rao and Justice Manmeet Pritam Singh Arora observed that the admitted facts established that the Petitioner and Respondent No. 3 participated in the subject tender and scored 100% marks in technical evaluation. They were the only two technically eligible bidders. Accordingly, Respondent No. 1 proceeded to open the financial bids, and the Petitioner emerged as the L1 bidder while Respondent No. 3 emerged as the L2 bidder. The results were published on Respondent No. 1’s website on July 18, 2026. The Court noted that in the subject tender, Respondent No. 1 adopted the QCBS (Quality and Cost-Based Selection) system for selection of bidders, as set out in Clauses 9, 10 and 11 of Section 3 of the subject tender. The final evaluation showed that the Petitioner scored 100 marks and Respondent No. 3 scored 92.69 marks.
On the locus of the Petitioner, the Court held that the locus of the Petitioner, having emerged as the eligible lowest bidder, to challenge the cancellation of the subject tender is duly recognised under paragraph no. 3.5.3(d)(viii) of the Manual for Procurement of Non-Consultancy Services, 2025. Since Respondent No. 1 intends to re-tender with the same requirements, the Petitioner is entitled to seek review of the reasons which led Respondent No. 1 to cancel the subject tender.
The Court examined the two reasons furnished by Respondent No. 1 for cancelling the subject tender. The first reason was deference to the observations made by the Court in its judgment dated 15.07.2026 in W.P.(C) 6915/2026 regarding non-publication of the tender on the GeM portal. The Court found no merit in this reason, observing that Respondent No. 1 had vehemently defended its decision of not floating the subject tender on the GeM portal in the earlier writ petition by stating that it was impermissible. The Court noted that despite expressing dissatisfaction with the explanation, it did not deem it fit to quash the subject tender on this ground; instead, it directed that the final decision should be placed before the Board of Directors as a safeguard to obviate allegations of bias. This direction was in no manner intended to provide a reason or cause to Respondent No. 1 to cancel the subject tender.
The second reason was that the Special Secretary (Finance)/Member of the Board observed that the latest Manual of Procurement had not been followed during the QCBS-based tendering process. The Court found that the explanation in the written submissions did not match with the submission of the Member recorded in the Meeting, and was inconsistent with the record. The Court noted that in W.P.(C) 6915/2026, when the QCBS system was challenged, Respondent No. 1 had vehemently justified its adoption, contending that it had consciously elected not to adopt the LCS method. Thus, the reason set out in the written submissions that Respondent No. 1 failed to follow the LCS method appeared to be a flip-flop.
On the loss to the public exchequer, the Court observed that the Board of Directors, while deciding to cancel the subject tender, also resolved to extend the contract of Respondent No. 3 for two months at a monthly price which was higher than the price quoted by the Petitioner. Respondent No. 3 stated that Respondent No. 1 did not even ask it to match the price offered by the Petitioner, and that it was not willing to match this price as it was unfeasible. Respondent No. 1, however, submitted that it was willing to permit the Petitioner to render services as an interim measure until the new tender process was completed.
The Court held that the action of Respondent No. 1 in extending the term of Respondent No. 3 at a monthly price higher than the monthly bid price offered by the Petitioner was wholly inexplicable. The Petitioner not only scored 100 marks for technical evaluation but also scored 100 marks for financial evaluation. It was difficult for the Court to reconcile the multiple inconsistent stands taken by Respondent No. 1 for not acting upon the L1 offer of the Petitioner as per the QCBS system.
The Court referred to paragraph no. 7.4.11(2) of the Manual for Procurement of Non-Consultancy Services (2025), which contemplates that where responsive bids are available, the aim should be to finalise the tender and not cancel it. The Court held that considering the fact that the Petitioner had emerged as the L1 bidder with 100% marks in technical and financial evaluation based on the QCBS system, Respondent No. 1’s Board as on 24.07.2026 had no good grounds for cancelling the subject tender. The Court further noted that the reasons recorded in the Minutes of the Meeting did not fall within the circumstances set out at paragraph no. 7.4.11(1). Instead, in view of the fact that the bids of the Petitioner and Respondent No. 3 were responsive, Respondent No. 1 ought to have proceeded with the subject tender as per paragraph no. 7.4.11(2).
The Court also observed that when the matter was first listed on 05.08.2026, admittedly no steps had been taken by Respondent No. 1 between 24.07.2026 and 05.08.2026 to publish the new tender on the GeM portal. Respondent No. 1 apprised the Court on 21.08.2026 that a new tender had been published on the GeM portal on 20.08.2026, without seeking any leave from the Court before publishing the new tender. The Court held that this action of Respondent No. 1 was an overreach of the reliefs sought in the writ proceedings.
The Court noted that the manner in which Respondent No. 1 conducted itself showed lack of diligence, and that Respondent No. 3 had been uninterruptedly rendering services since 2013 at the Terminal, with the contract having expired on 31.12.2025. The subject tender was the second tender cancelled by Respondent No. 1, leading to loss to the public exchequer and questioning the transparency in continuing with the incumbent contractor on an ad-hoc basis.
Despite finding that the explanation given by Respondent No. 1 for cancelling the subject tender lacked any clear rationale, the Court refrained from setting aside the impugned decision of cancellation, as it found that the manner and process adopted by Respondent No. 1 in floating the subject tender had been irregular and inconsistent with the applicable General Financial Rules, 2017. The non-floating of the subject tender on the GeM portal and limited participation of two qualified bidders was concerns which weighed with the Court in refraining from interfering.
Briefly, the Bluespring Enterprises Limited filed a writ petition under Article 226 of the Constitution before the Delhi High Court seeking quashing of the Notice dated 31.07.2026 issued by Delhi Transport Infrastructure Development Corporation Ltd. (DTIDC), cancelling the Notice Inviting Tender for “Operation and Maintenance of Electromechanical Services, Housekeeping, Security and Allied Installations at Maharana Pratap ISBT, Kashmere Gate,” citing “Administrative Reasons.” The tender was published on the GNCTD e-procurement portal.
The Petitioner submitted its technical bid on 14.05.2026 after depositing the Earnest Money Deposit of Rs. 46.08 lakhs along with the Tender fee of Rs. 5,000/-. Three bidders participated in the tender process, including the Petitioner and Respondent No. 3 (BVG India Ltd.). Both the Petitioner and Respondent No. 3 scored 100% marks in the technical evaluation, while the third bidder was declared technically disqualified. After dismissal of an earlier writ petition filed by a third party, the financial bids were evaluated. The Petitioner’s financial bid was found to be the lowest at Rs. 16.36 crores as against Respondent No. 3’s bid of Rs. 21.63 crores. The bid results were published on Respondent No. 1’s website, declaring the Petitioner as the L1 (lowest) bidder.
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However, Respondent No. 1 cancelled the subject tender vide the impugned Notice citing “Administrative Reasons” without disclosing any cogent reasons. The Petitioner alleged that the cancellation was intended to favour Respondent No. 3, who is the incumbent contractor but had emerged as the L2 bidder. Respondent No. 1 had earlier awarded a Contract Agreement dated Dec 20, 2020 to Respondent No. 3 for operation and maintenance of the Terminal for three years at Rs. 51.69 crores, which expired on Dec 31, 2023 but was extended till Dec 31, 2025. After expiry, Respondent No. 3 continued to perform the work on an ad-hoc basis without any subsisting contract. Respondent No. 1 had also previously issued NIT 76/2025-26 for the same work, which was cancelled vide Corrigendum.
The subject tender was issued at an estimated cost of Rs. 23.04 crores for a contractual period of one year with a provision for extension of two years. The last date for submission of bid was extended till May 21, 2026. A third-party entity had challenged the eligibility criteria, non-floating of the tender on the GeM portal, and scope of the tender before the Delhi High Court in W.P.(C) No. 6915/2026, which was dismissed vide judgment dated July 15, 2026.
When the writ petition was listed on Aug 05, 2026, Respondent No. 1 produced the Minutes of the Meeting of its Board of Directors dated July 24, 2026, resolving to cancel the subject tender with a direction to refloat the tender on the GeM portal by Sep 30, 2026. The Board also resolved to extend the existing contract of Respondent No. 3 for an additional two months until Sep 30, 2026 at an estimated cost of Rs. 3.54 crores inclusive of GST. The Petitioner contended that the cancellation was without any cogent reason except to favour Respondent No. 3, and that the two-month extension was given at a price higher than the price quoted by the Petitioner in its L1 bid.
